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The Fine Art of Industrial Relations – Why is it so misunderstood?

Reading Time: 7 minutes

By Paul McNamara. Published on 8 November 2017

Having spent the first seven years of my career as an HR Professional, and the last fourteen years in HR Search, I’ve met probably close to 10,000 HR practitioners. Some have been great, some not-so and all have their own stories and experiences that make them unique. But one of the skill-sets that is most rare and, in my opinion, can make the most interesting interviewees are those who have a focus on Industrial Relations.

To many HR people, the words themselves conjure up thoughts of strikes, militant workers railing against unfair fat-cat corporations and union reps holding companies to ransom over perceived slights. The reality of course is that the formation of unions and their focus on bettering the rights of workers is a major reason why we no longer have 12-hour day, 6-day week working patterns and why we now have benefits such as sick and holiday pay which we all take for granted.

Recently, I was introduced to Stephen Gaskell, who has specialised in Industrial and Employee Relations over his 30-year career. After graduating in Economics from Cardiff University, Stephen joined Ford Motor Company as an Industrial Relations Advisor. His career progressed in both generalist and specialist roles at industry giants, Exxon Mobil, BOC and American Express before he joined BP in 2006 as Vice President of Industrial and Employee Relations with responsibility for all IR/ER across a mix of unionised and non-unionised workforces.

I took the opportunity to speak with Stephen to find out from an industry expert what IR was all about, how it has developed and what the future held. He gave me some excellent insight.

Stephen Gaskell, Vice President Industrial and Employee Relations at BP Plc

Stephen Gaskell

PM: Stephen – What made you want to focus in Industrial Relations from an early age?

SG: While I was at Cardiff, one of my professors was a deep expert on the car industry and his passion got me interested. I was in Cardiff during the coal-miners’ strike of 1984 which was a turning point in British industrial relations history and that was a real eye-opener. Cardiff as a coal town was impacted terribly. We were expected to leave food out on our doorsteps at night and the wives of the miners would come down from the valleys and collect food to feed their families.

So, even though through my career I’ve had generalist and specialist jobs, even the generalist ones at Exxon or AMEX have had a strong ER/IR emphasis – I just seem to have a real affinity for it.

PM: Yet, most HR people I speak to, especially those early on in their careers, try their best to avoid it. Why do you think that is?

SG: I think that many HR people simply don’t like conflict and the nature of the conversations within the area. Also, there is a lack of understanding about what IR is and its importance to a successful and profitable business.

It’s fascinating to me to understand the reasons that an employee or employees can feel the need for a third party to represent them. Solving the intellectual and commercial challenges of trying to get under the skin of why that might be and to try and get the balance right between an organisation and its employees can be critical to business success. Just look recently at Ryanair, British Airways and Royal Mail; all these businesses have a challenging IR environment.

PM: You built a global ER/IR function in BP? What type of people have been successful and accepting that fewer new HR professionals want to specialise in this area, where are the next generation of ER/IR experts going to come from?

SG: It’s an interesting question and I’ll answer it in two parts.

The most successful people I’ve seen have had generalist experience and many of them have had line management in a manufacturing/blue-collar environment which perhaps is no surprise. They have a core negotiating skill-set and will be analytical and very comfortable with data. Some have belonged to the unions; the difference between a senior IR and a union guy from a skill point of view is very narrow.

With regards the second question, there is still manufacturing, shipping, airlines etc although of course the UK is much less manufacturing-dependent than it was 50 years ago. But there are people from those industries out there. However, the question I think about is: Will the IR job look the same? No, but the job it could and should be will be even more important. Why? Because alongside the core negotiations which will always remain it will have a high employee engagement focus and that link goes right to the heart of employee relations.

PM: Employee Engagement and Employee Relations are often placed at opposite ends of the HR spectrum. Have organisations got this wrong?

SG: Yes, I think it’s fundamentally in the wrong place. Engagement is too often a social experiment in ‘how happy can we make people feel’ which is neither commercial nor sensible. It should be about tuning into the aspirations of the workforce and working out what we need to do to get discretionary energy from our people. What makes them put their hands up for projects, look for efficiencies naturally, talk and act positively with regards their company? There is financial and shareholder value in this. Leading researchers in this area point to an achievable 20% improvement in employee discretionary energy – and from my experience this number feels about right. A frustration is that virtually every company tells you people are their most important asset but there’s a complete lack of sophistication in looking at the world from the bottom upwards? I think employee relations people naturally do this and maybe it’s because many started in line management that they can put themselves in the shoes of the workforce and see the great ideas that come from the core. There are policies that work top down but make little sense to the employee on the ground and I think we could help unleash amazing discretionary energy by harnessing their ideas.

PM: So, what changes do you see happening as organisations get better at this?

SG: A relentless focus on the capability of the first line leader or supervisor can prove vital to unleashing organisational energy. Often people become line mangers because they are good at the job below and as we all know that doesn’t always work. Employee Relations people have a hard edge and will work to drive better supervisor capability with a commercial mindset. It’s the simple will/skill process. If people have skill but not the will and won’t change you must change them. Those with will but not skill you develop and those with both will and skill should be rewarded differently and made your role models.

But there is a desire to see supervisors as one group and not recognise the differentiation.

The time taken to have difficult conversations with individuals who are not doing their job properly is not a road that leaders necessarily want to take. However, I bring it back to the fact that on an oil rig on an average Tuesday in middle of November, how hard the crew work will be down to both their direct supervisor and their willingness to put in the discretionary energy and that can quickly translate across multiple sites to millions of lost dollars in output per year.

So, instead of employee engagement being a ‘soft’ happiness index I would hope that the best ER/IR people will always be looking at how to improve the will/skill balance through many levers including ‘hard’ performance management. If good performers see poor performers being dealt with they will believe more in the merit of working hard but if they see that it doesn’t matter whether they try or don’t and that their pay-rise will be the same, then you compound injustice on top of injustice and that doesn’t equal an engaged or productive workforce. I’m aware that this is not new thinking but I genuinely believe those organisations that drive a competitive advantage in this area will maximise their chances of success.

PM: And finally, going back to the core IR skillset, what will the future hold and what’s your advice to those in the field?

SG: If everything stayed the same from a political perspective, I’ve no doubt that relations between unions and employers would gradually continue to improve. The conversations are more mature now and the unions’ understanding of the economics of a company have vastly improved. Through collaboration with management the unions are also aware of the business drivers and recognise that change is a part of life and not something that needs to be fought against every single step of the way. They might not like all the changes and they may fight against some of them, but you rarely now have a conversation about the philosophical need for change. The conversation now tends to focus more on how the change can be conducted in a fair and compassionate way.

What destabilises it is when political change shifts the pendulum in one direction or another. One side says, ‘we’re going to make it ten times easier to go on strike’ or another side says, ‘we’re going to make it ten times more difficult to go on strike’ that’s when it becomes dangerous. The changing dynamic unsettles the relationship between the company and its union.

Then one side or the other will seize the opportunity for their own means. My advice would be, be careful not to seize a battle and see it as winning the war as historically the pendulum swings back and forth. I try to discourage opportunism to win points, opportunism to whack the other party, whatever side you sit on because long term you will regret it. If you think your business is focused on the future and is here to stay, I would suggest it makes good business sense to create an atmosphere based on transparency, consistency and longevity.

My last bit of advice to business leaders is that there is often a very positive story to be told about the organisations approach to industrial relations. Often organisations will sweep it quietly away as it’s much nicer to talk about the diversity policy for example but the reality is that if progress has been made in your approach to industrial relations approach you need to share it as people soon forget!

Thanks Stephen – a fascinating insight and bearing in mind how much else we discussed, I’m not sure we’ve done it full justice.

Personally, what I feel has been validated from my conversation with Stephen is that for high quality HR professionals, having relevant experience in the strategic area of ER/IR can be a crucial component to building a successful HR CV. Far from being an area to be avoided, the ability to negotiate, debate and influence to create a positive employee/employer relationship whether in a unionised or non-unionised environment underpins the commerciality that CEOs expect from their HR functions.

To read the extended version of this interview, please click here